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Date: | Fri Mar 31 17:19:13 2006 |
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----------------- HES POSTING -----------------
Thanks Ross. I know that PV analysis (not perhaps by that name)
using a discount rate can be traced back to English damage claims
arising from the Great Fire of London. It was used in the valuation of
natural resources, notably forests and timber and is often ascribed in
that usage to 19th century Germans and Austrians (perhaps influenced
by the economists figuring in the recent discussions here), but can also
be traced to a much earlier English usage. (In this particular usage the
tables are turned the Germans and Austrians getting credit really due the
English!) I have a citation for that history, may have posted it here
before, and will dig it out again.
My introduction to the HES list was indeed researching the accuracy of
an attribution to Fisher of a definition of value as "the present worth
(PV) of future benefits." Have yet to get or find a confirmation of
source, but assuming it is Fisher, then indeed he used PV.
My specific question, however, was about the IRR concept.... the
discount rate at which PV costs = PV revenues, i.e. NPV = O. Do you
know who introduced it to PV analyses?
Thanks, Scott Cullen
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